More treats than tricks as October same-store sales rise more than expected

More treats than tricks as October same-store sales rise more than expected

During a month marked by a 16-day partial federal government shutdown, October sales at stores open more than a year rose 3.4 percent, better than the 2.3 percent expected by economists, according to Bloomberg LP.

“The consumer continues to shrug off [the government shutdown] and keep spending money, which is a good sign going into the holidays,” said Neil Stern, senior partner at Chicago-based retail consultant McMillan Doolittle.

Same-store sales are particularly important as retailers enter the crucial holiday season that accounts for up to 40 percent of their annual revenue, according to the National Retail Federation.

“It would appear that the consumer has come back, just at the right time,” said Michael P. Niemira, vice president of research and chief economist for the International Council of Shopping Centers, in a press release.

“L Brands hit a home run in our estimation,” wrote Ken Perkins, research analyst for Swampscott, Mass.-based Retail Metrics. “Victoria’s Secret was the standout with a 10 percent same-store sales increase fueled by strength in lingerie, Pink and beauty.”

L Brands’ shares fell $1.22, or nearly 2 percent, to $61.81 at Thursday’s market close. The company said November comparable sales would only reach single-digit gains even though the month includes Black Friday, the busiest shopping day of the year.

Long-suffering J.C. Penney Company Inc. reported a 0.9 percent comparable sales gain, the first positive monthly gain since December 2011, according to Bloomberg LP. Shares of the troubled retailer soared nearly 6 percent to close at $8.13 Thursday, but analysts remained cautious.

“As a reminder, Penney was up against the easiest of negative comparisons,” Perkin wrote. “We would not get too excited over this result.”

Gap Inc. comparable store sales rose a much stronger-than-expected 4 percent and raised its estimate for third-quarter sales. Analysts had expected a 0.6 percent increase. Gap’s flagship brand led the gains with a 5 percent increase in comparable sales. The company also owns Old Navy and Banana Republic.

“What most people are going to look for are combined November and December numbers,” said Stern. “I think retailers will in general will have a good, not great, holiday. They will have to work hard for sales, it’s not a given that they are going to have a good year.”

Costco Wholesale Corp. saw 3 percent growth in comparable store sales that exceeded the analysts’ estimate. Costco has seen “choppy” results this year, Perkins said. “The warehouse club has missed expectations five times this year while also exceeding estimates five times this year.”

Stein Mart Inc. comparable store sales increased 5.4 percent, more than double the analysts’ consensus estimate of 2.2 percent, following the first full month of e-commerce sales for the company.